Failing to pay your rates and taxes could lead to disastrous outcomes. In this article, we share steps to take if you’re struggling to pay.
If you’re experiencing financial difficulties and cannot pay your local municipal rates and taxes, contact your local municipality straight away. Most local municipalities have various programs that are aimed to assist struggling individuals and sometimes will waive the interest on overdue rates.
Rates are a high-priority debt, so get started quickly.
When Can Rates and Taxes Be Terminated?
- A landlord may not, without a court order, terminate the supply of water and electricity to premises leased to a tenant who is in arrears with monthly electricity payments.
- Regulation 3 of the National Water Act, 36 of 1998 stipulates that a minimum quantity of potable water of 25 liters per person per day, or six kilolitres per household per month, must be provided. Section 27(1)(b) of the Constitution stipulates that everyone has the right to have access to sufficient food and water. South African courts have ruled that no person can be denied the basic 6000 liters of water per household per month, irrespective of the state of their account. A municipality cannot disconnect the water supply completely; however, it may disconnect electricity if the water account and other accounts for charges levied on the property have not been paid.
How do I contact SARS with my debt query?
Taxpayers can now request Account related queries (balance statements) and/or a Statement of Account by sending an SMS to SARS on 47277. Send the following wording to 47277: Balance (Space) ID number/Passport number/ Asylum Seeker number
These services can be accessed with or without data/airtime. For more detail, see the Guide to SARS Mobile Tax Services.
For normal debt queries (Individuals and Businesses):
You may contact SARS by phone or email:
- Call SARS Contact Centre on 0800 00 7277 between 09:00 to 16:30
- International Callers may contact our SARS Contact Centre on +27 11 602 2093 between 09:00 to 16:30 South African local time
- See our centralised Email addresses.
For all business rescues and compromises in terms of section 155 of the Companies Act correspondence or notices please use: email@example.com.
Taxpayers, both individuals, and businesses, are required to be fully tax compliant through on-time submission of returns and payments.
In instances where taxpayers are not compliant and have outstanding tax debt, the Debt Management department is committed to assisting businesses and individuals to become fully compliant.
SARS wants to assist you to manage your tax debt. Reach out to SARS and ensure that you comply with your tax obligations. See more information on how to manage your debt.
Options available to service your sars debt
- Pay full balance outstanding within seven days
- Request with reason and proof to pay in instalments ITO of section 167 of TAA
- Request with reasons and proof to compromise the debt ITO of s200/201/202 of the TAA
- Where debt is disputed/there’s an intention to dispute apply for the suspension of debt in terms of s164 of the TAA
How much do I owe sars?
There are three ways to find out how much tax debt you owe:
1. Call the SARS Contact Centre.
Steps to follow:
- Call the SARS Contact Centre and request a statement of account.
- You will be requested to provide your tax reference number.
- If you do not have your tax reference number you can provide the SARS Contact Centre Agent with your ID number or the business registration number.
- Please note the SARS Contact Centre Agent will follow an authentication process.
2. Log on to eFiling and request a statement of account.
3. Log on to the SARS MobiApp and request a statement of account.
How do I make a payment to South African Revenue Service?
For more information on payment options, please click here.
What if I can’t pay South African Revenue Service the full amount now?
In order to avoid penalties and interest, it is best to file returns and make payments on time.
If you are not currently able to pay your tax debt, please contact SARS without delay.
In certain circumstances, we can reach an agreement with you to defer your tax debt for later payment or for payment by instalments.
Please note the following:
- SARS has the option to decline the request.
- Interest will accrue on any unpaid debt.
- If you don’t adhere to the conditions of the payment arrangement the payment agreement will be terminated and normal collection proceedings will resume.
In certain circumstances, a compromise may be requested on your outstanding tax debt. You will need to discuss your financial position openly with SARS.
If you require payment arrangements please contact us and we will assist you and provide you with all relevant documentation.
For more information on how to contact them please click here.
How do I make payment arrangements with the South African Revenue Service?
Do you have outstanding tax debt and are unable to settle the amount in one payment?
SARS provides for a deferment, or instalment payment arrangement for outstanding tax debt. You may request and enter into an instalment payment arrangement with SARS. It allows you to pay your outstanding debt in one sum or in instalments over time until you have paid your entire debt including applicable interest. This agreement however would be subject to certain qualifying criteria.
A payment arrangement may be requested through:
- SARS eFiling:
- To see the steps on how to make payment arrangements on eFiling, click here.
- Payment arrangements can be made once the debt is outstanding;
- The Contact Centre on 0800 00 7277;
- A Debt Management Office
- Email any outstanding debt queries and deferred arrangements requests to Sarsdebtmanagement2@sars.gov.za.
Criteria for payment arrangements
SARS may enter into a payment agreement only if:
- The taxpayer suffers from a lack of assets or liquidity which is reasonably certain to be remedied in the future;
- The taxpayer anticipates income or other receipts which can be used to satisfy the tax debt;
- Prospects of immediate collection activity are poor or uneconomical but are likely to improve in the future;
- Collection activity would be harsh in the particular case and the deferral or instalment agreement is unlikely to prejudice tax collection;
- The taxpayer provides the security as may be required;
- All outstanding returns and/or recons are submitted.
Tip 1: The payment arrangement must cover the entire debt and SARS may only consider the payment arrangement request when non-compliance has been remedied (i.e. all returns and/or recons are submitted).
Tip 2: If the taxpayer has defaulted on a previous payment arrangement, reasonable and valid reasons for the default must be provided before another deferment request can be requested.
What if I don’t agree with the debt?
If you are not in agreement with your tax debt, you may lodge a dispute.
To lodge a dispute please go to objections and appeals.
Even though you are disputing the tax debt you remain under obligation to pay the debt whilst your dispute is being handled.
Application for suspension of payment may be requested while the dispute is being dealt with.
Interest will accrue on any unpaid debt.
Call the contact centre or visit your nearest branch for assistance. Remember to make an appointment.
For more information on how to contact them please click here.
What if I don’t pay my taxes?
It is a criminal offence not to submit a tax return when it is due and can be a criminal offence not to pay.
If you don’t pay your taxes there are a number of debt collection options at our disposal:
- Collect the debt from someone who holds money on your behalf Third Party appointments i.e. employer, bank or customer.
- Issue a judgement and have your name blacklisted.
- Attach and sell your assets.
- Obtain a preservation order in respect of your assets.
- If you hold assets off-shore, an order can be obtained compelling the assets to be repatriated to South Africa and in the interim, your right to trade or to travel can be restrained.
- Liquidate or Sequestrate your Estate
If you are having difficulties we encourage you to contact us to avoid these collection steps.
Cost of non-compliance or failure to pay
If after all the collection efforts have not been honoured, SARS will institute enforcement collection actions as follows:
- Collect the money against any third party in terms of section 179 of the TAA
- Issue a Civil Judgement Court against the taxpayer
- Attach the assets of the taxpayer
- Hold the directors/members/related parties liable for the debt
- Sequestrate/liquidate the taxpayer
- Preserve the assets against the debt
Speak to one of our debt counsellors
If your problem still hasn’t been solved, or you’re feeling overwhelmed, call us on 0410125036 to speak with one of our debt counsellors.